YOKOHAMA, Japan — Masa puts his arm affectionately around Konoha's sloping shoulders on the couch in his apartment and gently brushes her hair from her bright blue eyes. Iris stands behind them, decked out in a frilly dress.

Masa speaks warmly to Kohona and Iris, greeting them brightly each morning and when he returns home from work, but they never answer. His two companions are life-sized dolls.

"She doesn't have to talk, because I enjoy her as a doll, not as a substitute for a person,'' Masa, a 32-year-old computer engineer who asked to be identified only by a shortening of his first name, said of Konoha, his favourite.

A grown man living with two nearly 5-foot-tall dolls -- and dozens of smaller figurines -- would seem bizarre anywhere. And indeed, Masa keeps his full identity hidden and his curtains drawn to avoid ridicule by outsiders.

But he also is on the cutting edge of a billion-dollar Nerd Culture that has grown so enormous it has taken over an entire neighbourhood in Tokyo and is making inroads into the mainstream.

The culture is firmly rooted in Japan's enduring fascination with "manga'' comic books and animation that have won fans and critical acclaim worldwide.

But Masa and others like him -- known as "otaku'' -- have taken that trend to another level by collecting dolls like Konoha or flocking to cafes staffed by waitresses dressed as comic book maids. They stock web pages with photos of their dolls "posing'' along country roads or taking a dip in hotspring baths.

The growing popularity of "otaku culture'' has transformed the Akihabara neighbourhood in downtown Tokyo from the city's main electronics district into a magnet for 20- to 40-year-old men looking for comics, videogames and anime DVDs. Figurines of all sizes of sexy doe-eyed girls in mini-skirts are big sellers. Maid cafes are on every block.

While part of the appeal of manga and anime figures is pornographic, an Internet survey of Japan's doll collectors indicated most buy the figures only to dress or photograph them or simply to show them off.

The otaku -- overwhelmingly male -- have long been considered social misfits who soothe their loneliness with fantasy, but the runaway success of a movie this year about a nerd who falls in love, Train Man, has helped make otaku tastes and aesthetics more widely embraced in Japan.

"Otaku used to be locked inside their rooms, but I think there is more social acceptance of them now,'' Kosuke Tanaka, a 21-year-old college junior, said while examining a doll in a navy-blue school bathing suit.

The subculture even has its own codeword: "moe,'' an eros-laced affection for female comics and anime characters. Once known only among the nerd cognoscenti, the phrase has entered the mainstream and was the cultural buzzword of the year.

Such hobbies might still seem marginal -- until you consider the money involved.

The Hamagin Research Institute in Yokohama estimated 2003 sales of comics, games and anime films in the "moe'' genre totalled $767 million US.

The otaku economy includes Internet auctions of dolls, comics, films, trading cards, outfits. Osaka-based Kaiyodo Co., Japan's leading anime-doll maker, projects sales of $25.6 million this year, up 10 per cent from the previous year.

Economist Takuro Morinaga at UFJ Institute puts the overall otaku market at $26 billion to $34 billion.

The "moe'' phenomenon is also drawing spectators.

"Akihabara is an emerging tourist destination. ... It's like a theme park,'' said Shinichiro Nagashima at Japan's largest travel agent, JTB Corp.'s publishing arm, which issued a "Tokyo city guide for new type.''

While Masa and his fellows might seem strange, their hobbies are not entirely beyond the scope of Japanese culture.

The country has long nurtured a fascination with artifice -- think bonsai, rock gardens or even gadgets like talking vending machines. Otaku have married that with the deep affection for innocence, which sometimes leads to young girls being viewed as sex symbols.

The phenomenon is seen by many as a troubling deviation, reflecting a loss of confidence among youth and a Japanese aversion to personal conflict -- typified by the estimated one million social recluses known as "hikikomori.'' Some critics link the fascination with female characters to crimes targeting young girls.

"Because of fear of being rejected or disliked, people turn to anime characters or idols that pose no personal conflict,'' said psychologist Rika Kayama. "But there is a danger. ... Otaku who live in the fantasy world of anime often give little thought to how they may look to others.''

Masa, however, is concerned about the way he is seen by others, and he resents any suggestion that otaku are deviant. But he doesn't let those concerns get in the way of his expensive hobbies.

In addition to Konoha and Iris, which together cost more than $6,000, his tiny living room is stocked with dozens of smaller dolls, robots and comics.

Masa's dolls are well-cared for. Their clothes take up more room in his closet than his own do: a Chinese-style dress with deep side-slits, blouses with bows, outfits of all kinds. He has also bought lace-up boots, sneakers and other footwear for the dolls when he goes driving with them in his van, mainly to take pictures.

He carefully combs Konoha's brown hair with a wooden comb to cut down on static. Concerned that her mini-skirt is a tad immodest, he folds her pale hand demurely over her lap.

He has no intention of ever getting married or finding a girlfriend.

"Konoha looks straight out, as if she is talking to you,'' Masa said as he adjusted the angle of her head. "She has a face that makes her my dream girl.''